But these amendments made in the document will be applicable for the income of the next financial year, i.e. 2023-24, and this means that the income due in the current ongoing and ending on March 31, 2023, will be taxed in the financial year 2022-23. Only the old tax regime (Old Tax Regime) or the existing new tax regime (New Tax Regime – Existing) will be available for calculation. Now it is worth noting that when the hassle of filing income tax return comes on this year’s income, then only the existing rules can be adopted for it, therefore, the limit of tax free income will remain only 2.5 lakhs, and income tax The exemption limit under Section 87A of the Act will also remain the same at Rs 5 lakh, whether you switch to the new tax regime, or remain mindful of the old tax regime.
From whom will the income tax go…?
Today, we are explaining to you with the help of a chart that how much tax the taxpayers who make some savings or investments will pay, and in which tax system they will get more benefits. In the same chart, however, we also indicate how much they will benefit from the proposed new tax regime this time on their income for the next financial year. The examples I have taken in this chart are salaried people with annual income of 8 lakhs, 10 lakhs, 12 lakhs, 15 lakhs, 20 lakhs, 25 lakhs, 30 lakhs, 35 lakhs, 40 lakhs, 45 lakhs and 50 lakhs respectively Are. To put the chart together, we assume that all these taxpayers have taken the standard deduction (standard deduction) of Rs 50,000 under section 80C of the Income Tax Act (life insurance premium, PPF, PF, children’s school insurance, home loan principal ) refund etc.) Maximum exemption of Rs 1,50,000, deduction of Rs 50,000 on account of National Pension System (NPS) (Section 80CCD 1B) and Rs 75,000 on account of house rent allowance (HRA) or home loan loan Received a discount of Rs. That is, each of these taxpayers has claimed a total exemption of Rs 3,25,000.
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Now you will remember that in the old tax system (old tax system), taxable income is fixed by deducting all these exemptions from the total income, and then tax is calculated. None of these exemptions can be availed in the current new tax regime (New Tax Regime – Existing), but the income tax rates are lower than in the old tax regime.
What are the discounts available now…?
So, now look at this chart carefully, you will see that in the old tax regime every taxpayer has got exemption of entire 3,25,000, and this amount has been deducted from his taxable income, i.e. taxable income, and After that tax is calculated. On the other hand, in the current new tax regime, there is no exemption of any kind, so the taxable income of each taxpayer is almost as much as his total income. By the way, a column has also been made in the chart, Proposed new tax regime, in which it has been told that based on the rules that will be applicable next year, how much will be your taxable income and income tax. The last column of this chart is showing the amount that would be saved by these taxpayers by continuing in the old tax regime, if all these taxpayers switch to the new tax regime to pay income tax, they would have to pay that much more.
Where is the benefit on an annual income of 8 lakh rupees…?
In the first example, if a person having a job of Rs.8 lakhs avails a total exemption of Rs.3,25,000, his taxable income in the old tax regime would come down to Rs.4,75,000 only, and the income under section 87A of the Income Tax Act would be Rs. His tax liability will be nil by getting the exemption under the new tax regime, whereas in the current new tax regime, because he will not get the benefit of any exemption, he will have to pay at least Rs 46,800 as tax (education cess, ie related to education) despite Will be the giver. , So, he will get a total profit of Rs.46,800 if he continues in the old tax regime.
Where is the benefit of earning 10 lakh rupees…?
Similarly, in the old tax regime, a person earning Rs 10 lakh would be given a taxable income of Rs 6,75,000, and on that the taxpayer would pay Rs 49,400 (including education cess, ie education), whereas in the current new tax regime, But he will have to pay Rs 78,000, so, this person will pay Rs 28,600 more if he moves to the current new tax regime.
If the income is 12 lakh rupees, then where to go…?
The third example of the same chart is of a person who earns Rs 12 lakh shares, and his taxable income is kept at Rs 8,75,000 after the exemption in the old tax regime. On this amount, his total bill would come to Rs 91,000, which includes 4 per cent education cess. For example, in the case of opting for the existing new tax regime, he will be paid Rs 1,19,600, ie here also he will get a benefit of Rs 28,600 if he remains in the old tax regime.
Earning 15 lakh rupees or more, then which regime is better…?
The following example shows a salaried individual with an annual income of Rs 15 lakh, and after the exemption, his taxable income in the old regime becomes Rs 11,75,000, on which he will have to pay a total income tax of Rs 1,71,600, whereas in the current regime, If he opts for the new tax regime, he will have to pay a total income tax of Rs 1,95,000. That is, this person can make a profit of Rs 23,400 by sticking to the old tax regime. After this, the salaried people earning Rs 20 lakh, 25 lakh, 30 lakh, 35 lakh, 40 lakh, 45 lakh and 50 lakh per annum will also get the same benefit of Rs 23,400 if they continue in the old tax regime.
So, now it is clear to you that if you get total exemption of more than Rs.3 lakh share, you will get the benefit only if you remain in the old tax regime of income tax, and if you go to the existing new tax regime this year itself. If you select the system, you will need to read more details tex.
Another interesting fact from income tax calculation…
Therefore, after seeing and understanding all this, a very interesting fact is that if your income is Rs.8 lakh or Rs.10 lakh contract, and will adopt the proposed new tax regime to be implemented next year, you will still be in loss, but If you are earning Rs 12 lakh or more per share, then from next year onwards all the savings will remain in profit in the proposed new system.